Being a millennial can be pretty tough. It seems as though we are destined never to own our own homes and constantly be associated with avocado toast (even though quite honestly I’d much rather slather half a jar of Nutella on mine!); however, there are some mistakes that we are all making with our money that we really need to stop. Here are a few.
Lacking goals and direction
Sure, we all want to make some decent money (the average millennial student debt is around $35,000, so it’s certainly needed) but without any idea of where you want to go (and no, going to Asia to “find yourself” doesn’t count!), you are simply not going to be achieving what you want to. So what do you want to make more money for? Do you want to buy a house, start a family to pay off that student debt? Quantify these goals in regards to time and value and then prioritize which ones are most important to you. This will help keep you focused as you can see what you are working towards. It’s much easier to achieve goals once you know what exactly they are – otherwise you have no accountability and money just seems to seep out of your bank account!
Okay, so budgeting is boring, and it doesn’t work with your spontaneous life, but it is so important for you to get a handle on your finances. If you don’t budget, you can easily end up overspending and have to dip into your savings to fix a shortfall. Putting together a budget is tedious, but once it is done, it should only ever need adapting slightly, and it will make a great difference to your bank account. You could also do this retrospectively, to begin with, and see what you have spent money on in a month to work out how best to cut down and better budget your available funds.
Investing is fun and exciting, of course, but it is not always the wisest thing you can do, at least while you’re still young. If you haven’t yet nailed budgeting, or highlighted your financial goals, you shouldn’t even be considering investing, you’re just not there yet! That’s okay of course, investment is pretty advanced, and the main focus should be on clearing your debts and working on your cash reserves. Don’t run before you can walk, and just invest for the sake of investing, keep focused on the first two points and your time to invest will come when you are much more ready for it.
Struggling financially can be tough, but you are not alone. It seems as though millennial personal finances are as complicated as they have ever been, and things are only set to get more difficult in the next few years. It can be easy to get complacent and resign yourself to a life of debt and financial struggles, or you can take this advice and work hard to become more financially secure. You can do it!